Wrapped tokens are revolutionizing decentralized finance (DeFi) by enabling cross-chain interoperability. Coinbase has taken a significant step forward by introducing cbDOGE and cbXRP, ERC-20 tokens backed 1:1 by Dogecoin and XRP held in custody. These assets are now live on Base, Coinbase’s Ethereum Layer 2 network, expanding their utility across DeFi applications.
Key Features of Wrapped Tokens
- Interoperability: Facilitates seamless movement of assets between blockchains.
- DeFi Integration: Enables participation in lending, trading, and yield farming.
- 1:1 Backing: Each wrapped token is fully collateralized by its native counterpart.
👉 Explore DeFi opportunities with wrapped tokens
Why This Matters for DeFi
Dillon Liang of Blueprint Finance highlights the importance:
"These assets now have access to Base’s growing ecosystem, unlocking DeFi apps, enhanced liquidity, and new utility cases."
Current stats:
- 10.4M cbDOGE and 2.3M cbXRP issued on Base.
- Coinbase’s wrapped Bitcoin (cbBTC) boasts a $4.7B market cap.
Upcoming Expansions
Coinbase plans to launch:
- cbLTC (Wrapped Litecoin)
- cbADA (Wrapped Cardano)
Market Impact
The wrapped token sector now commands a $46.6B market cap, reflecting growing demand for cross-chain solutions. Alexander Blume of Two Prime likens these products to ETFs, bridging crypto with traditional finance rails.
FAQs
Q: What are wrapped tokens?
A: Digital representations of assets on non-native blockchains (e.g., DOGE as an ERC-20 token).
Q: How does Coinbase ensure security?
A: Tokens are 100% backed by reserves held in Coinbase custody.
Q: Can wrapped tokens be unwrapped?
A: Yes, users can redeem them for the original asset at any time.
Q: What chains support cbDOGE/cbXRP?
A: Currently Base (Ethereum L2), with potential for multi-chain expansion.
👉 Start trading wrapped tokens today
Broader Crypto Developments
BlackRock’s Bitcoin ETF Dominance
- IBIT has amassed $70B in assets**, generating **$187.2M annual fees.
- BlackRock holds 696K BTC, underscoring institutional confidence.
Miner Momentum
- Hut 8 surged 15% after securing a 310MW power deal in Ontario.
- Bitcoin miners rally as BTC approaches $110K.
Regulatory Advances
- Ripple and Circle applied for national bank charters, signaling tighter integration between crypto and traditional finance.
Meme Coin Volatility
- DOGE and $TRUMP dipped amid renewed Elon Musk-Donald Trump tensions.
Wrapped tokens are reshaping DeFi—stay ahead with Coinbase’s latest innovations.